This paper aims to reduce the tunnel cable systems’ power loss using different grounding and loss reduction methods. The submarine tunnel power cable project at Ningbo–Zhoushan in China is considered here as a case study. The cable is divided into micro-element segment, and their nodal admittance matrices are established using the telegraph equation. This approach helps to avert the prerequisite of diagonalizing the propagation matrix. For the analysis of induced voltage and circulating current in the cable sheath, the cascading algorithm is used while considering the presence of grounding node. It is found that the mixed cable laying methods and different lengths between minor sections result in a high circulating sheath current. This study finds that coordinating the amplitude and phase angle of series impedance inserted at the cross-bonded joint can reduce the cable system's power loss.